1. MKTG 7 : Product Planning and Development Chapter 4 : Preparation and Alternatives PASIG CATHOLIC COLLEGE Professor : Mr. Abelito T. Quiwa School Year 2013 - 2014

2. Topics under this chapter Managers tasks of preparing the firm for ideation To know what is a concept and how it is typically found and identified. To explore a specific system of active (not reactive) concept generation, including approaches that seem to work. System using employees and nonemployees in a search for ready-made ideas 3. Finding the Right People Creativity has been described by Craig Wynett, a senior manager at P&G, as the everyday task of making nonobvious connections. Firms like P&G that are known for their innovation product programs are also known for being staffed with highly creative people-those that get ideas with a high degree of usefulness. Unconventional individuals those with diverse experiences, great enthusiasm for innovation, and more foreign experience, for example- are better bets to come up with successful innovations than are run-of-the-mill technical personnel. 4. Example of highly creative person was Harry Coover, the discoverer of superglue (cyanoacrylate adhesives). He also was the first to get the idea that supeglues could be used by doctors as an adhesive for human tissues. Most people think reproductivity solve problems in ways that have worked for us in the past. Creative geneus thinking how to visualize the problem. Nobel prize winning physicist Richard Feynman called it inventing new ways to think. Ex. What is half of 13? Most of us would say 6.5. Research report suggest two different types of creative people: those with artistic creativity and those with scientific creativity. But new product creative types (inventors, really) need both. Engineers without the touch of the artist and artist without scientific strength are probably less successful in new products ideation. Finding the Right People 5. A common stereotype is that creative persons are eccentric. While this may not always be the case, cretive individuals do announce themselves by leaving a lifetime trail of creative accomplishments. Creativity can be measured using the standard MBTI (Myers-Briggs Type Indicator) Creativity Index. Finding the Right People Degree of artistic creativity The Three Forms of Human creativity No Creativity Engineer Chemist Painter Composer Inventor 6. Geneus Thinking Strategies 1. Geniuses find many different ways to look at a problem. Einstein, for example, and da Vinci, were well known for looking at their problems from many different perspectives. 2. Geniuses make their thoughts visible. Da Vincis famous sketches, and Galileos diagrams of the planets, allowed them to display information visibly rather than relying strictly on mathematical analysis. 3. Geniuses produce. Thomas Edison had a quota of oneinvention every 10 days. Mozart was among the most prolific composers over his short life. 4. Geniuses make novel combination. Einstein found the relationship between energy, mass, and the speed of light the equation E = mc ( to the power of 2) 7. 5. Geniuses force relationships. They can make connections where others cannot. Kekule dreamed of a snake biting its tail, immediately suggesting to him that the molecule he was studying ( benzene) was circular. 6. Geniuses think in opposites. This will open suggest a new point of view. Physicist Neils Bohr conceived of light as being both a wave and particle. 7. Geniuses think metaphorically. Bell thought of a membrane moving steel, and its similarity to the construction of the ear; this led to the development of the telephone earpiece. 8. Geniuse prepare themselves for chance. Fleming was not the first to see mold forming on a culture, but was the first to investigate the mold, which eventually led to the discovery of penicillin. Geneus Thinking Strategies 8. Special Rewards There is no question about the value of recognizing creative achievement. But creative people are usually unimpressed by group rewards. They believe group contributions are never equal, especially if thegroup is company employees, for many of whom creative have great disdain. But creatives do like personal accolates- preferably immediately. The famous Thomas Watson of IBM commonly carried spare cash in his pockets so he could reward persons with goods ideas when he heard them. Campbell Soup has President Awards for Excellence. Many firms have annual dinners to 9. Killer Phrases: Roadblocks in the Generation of New Product Concept It simply wont work. I believe we tried that once before Are you sure of that We dont usually do things that way. You cant be serious. It seems like a gimmick to me. Its agains our policy Lets shelve it fo the time being Its good, but impractical. That sounds awfully complicated That wont work in our market Production wont accept that. Lets think about the some more. People will think were crazy. I agree, but ............... Engineering cant do that. Weve done it the other way for a long time. You could never sell that downstairs. But who is going to drive that idea? Where are you going to get the money for thart. OK, but lets slow down a bit. We can just do that. Im afraid theres precedent in this. Who thought of that? We have too many projects now. Its probably too big to us. Well need more background on that. 10. The Removal of Roadblocks Some organizations use a technique called itemized response. All client trainees must practice it personally. When an idea comes up, listeners must first cite all of its advantages. Then they address the negative, but only in a positivemode. The recommended language for bringing up a negative is OK. Now lets see what would be the best way to overcome such-and-such a problem. Note that this constructive comments assumes the problem can be overcome, and the listener offers to help. To encourage creativity, some firms deliberately encourage conflict by putting certain employees together on the same team- for example, a blue-sky creative person and a practical type. This technique is sometimes called creative abrasion. The bottom line here is that managers need to be aware of the barriers to group creativity. New product team are, by definition, cross-functional, which means a greater variety of perspectives but also potential difficulties in reaching a solution acceptable to all. Further, if the team members share strong interpersonal ties, the creative abrasion might be lacking: Team members may simply reach friendly agreements 11. Barriers for Firm Creativity 1. Cross-functional diversity. A diverse team means a wide variety of perspectives and more creative stimulation, but also can lead to difficulties in problem solving and information oveload. 2. Allegiance to functional areas. The team members need to have a sense of belonging and to feel they have a stake in the teams success. Without this, they will be loyal to their functional area, not to the team. 3. Social cohesion. Perhaps a little unexpectedly, if the interpersonal ties between team members are too strong, candid debate might be replaced by friendly agreement, resulting in less innovative ideas. 4. The role of top management. If senior management stresses continuous improvement, the team might stick with familiar product development strategies and make only incremental changes. Top management should encourage the team to be adventurous and try newer ideas. 12. The Concept Back before technical work was finished, the product was even more of a concept. To understand this, and see how it relates to the ideation process, we have to look at the three inputs required by the creation process. Form: This is the physical thing createdm, or in the case of a service, it is the sequence of steps by which the service will be created. Thus with a bew steel alloy, form is the actual bar or rod of material. On a new mobile phone service it includes the hardware, software, people, procedures, and so on, by which call are made and received. 13. Three inputs required by the creation process: Technology: This is the source by which the form was attained. Thus for the steel alloy it included, among others, the steel and other chemicals used for the alloy, the science of metallurgy, product forming machines, cutting machines, and more. Technology is defined in product innovation as the power to do work. In most cases there is one clear technology that is all the base of the innovation, the one that served as the technical dimension of the focus-arena. Sometimes there are two. The Concept 14. Three inputs required by the creation process: Need/Benefits: The product has value only as it provides some benefits to the customer that the customer sees a need or desire for. We put these together this way: Technology permits us to develop a form that provides the benefit. It any of those three is missing, there cannot be product innovation, unless one buys a product ready-made and resells it without change. Even then, there would be some change in the service dimension-where it is sold, how it is seviced, and so on. The Concept 15. The Designer Decaf Example Typically, coffee sold in North America contained ablend of cheaper coffee beans, and that was that. Withthe emergence of Starbucks and competitors, the North America coffee-drinking culture change abruptly. Fancy coffe bars, based on the Italian coffee bar model, sprang up everywhere, and Italia-style expresso soared in popularity. Espresso-based concoctions like cappuccinos and lattes, often selling for three to four times the price of restaurant coffee, become big sellers overnight. Lets imagine we worked ar a major coffee roasting company at about this time. Imagine three different people walked into the new product office one week, at different times, each with an idea for a new product. Each was unaware the others were coming in. 16. One person said, Our most recent customer satisfaction report disclosed that customers would like a decaffeinated espresso coffee that tastes identical to regular espresso and can deliver a full- flavored cappuccino. No current decafs offer this benefit. The second person was a product manager who said I was thinking last week about our coffees, and our competitors, and noticed they were all about the same color and thickness. I wonder if we could mass-produce a darker espresso that actually pours out thickers, something like Turkish coffee (form) The Designer Decaf Example 17. The third person was a scientist who had just returned from a technical forum and said, I heard discussion of a new chemical extraction process that can isolate and separate chemicals from foods cheaply and effectively; may be it could be applied to talking caffeine our of coffee(technology) What might best sum up the point that a concept is evolving from its creation until it metamorphoses into a new product, is the saying of one manager: Dont waste your time trying to find a great new product idea; its our job to take a rather ordinary idea and make it into a successful new product. The Designer Decaf Example 18. The Concept Statement Once the concept appears, with two of the three dimensions (technology, form, benefits), we have to screen it before undertaking development. Technical people and intended customers must tell us the concept is worthy of development. Technical people and intended customermust tell us the concept is worthy of development. Their review of the concept of statement allows this, if the concept tells them what they need to know to make that judgement. A concept statement will usually do this if it has two of the three basic essentials ( technology, form, benefit). 19. A concept then, is a verbal and/or prototype expression that tells what is going to be changed and how the customer stands to gain (and lose). Early, on the information is quite incomplete, but when marketed the concept is (hopefully) complete. Any thing that doesnt communicate gain and loss to the intended buyer is still just an idea that needs work. The Concept Statement 20. Two Basic Approaches Most firm use both ready-made and tailored. But in each industry it is common knowledge as to which has a better batting average. For example, food manufacturing usually will not even read new product suggestions sent in by consumers. They have more enoug concepts of their own, consumer suggestions are very repetitive or old ideas, and even just glancing at hundreds or thousands of ideas every year would be almost impossible. Some manufacturers have employee and customer idea contests. Even in the food industry, one firm( Pillsbury) has found it profitable to run an annual Bake-off Contest to capture thousands of new recipes for their possible use. Concept generation should be an active, not reactive 21. Important Sources of Ready-Made New Produc Ideas Experience in the field of product innovation has it that 40 to 50 percent of new product ideas are ready- made, coming at least partially from employees, suppliers, end-users, and other stakeholders, and published information. More recent additions to the list are consulting engineering firms, and smaller firms with expertise in idea exploration. Among the latter are small biotech companies that have the expertise to do early-stage development, testing, or commercialization. Large pharmaceutical firms turn to these biotech companies as a rich source of new product ideas. Product development professional (or more experienced users) will have a more realistic view of what is and is not feasible. The role of the end users also depends on the industry.